Washington State Has Created the Nation’s First Social-Insurance Program for Long-Term Care

About three years ago, Ruth Egger’s father got up to go to the bathroom in the night. When he tried to get back into bed, he fell, breaking his hip. The painful recovery, during which he used a walker, sent him into a depression. “Since then, he’s gone downhill,” Egger said. He suffers from memory loss, had gallbladder surgery, and now needs help dressing, showering, and even taking medication.

Egger’s parents, both in their early 90s, are fortunate enough to be able to afford to live in an assisted-living facility in Issaquah, Washington. But their rent is climbing while their income stays fixed, forcing them to draw from their savings. That has made them unwilling to pay for the extra services available at their facility that could really make a difference for them, including help with chores and assistance for Egger’s father with his daily tasks. Without another adult present, Egger’s mother is afraid to leave her husband to go to the pool or exercise classes in case he falls again. “My mother suffers because she has to do everything,” Egger said. “I would feel so much happier if they had somebody at least once a week come in so [she] would feel like she could leave and go to the doctor or do what she needs to do and not worry about him…. It would give her some relief.” But, she adds, “They are just so frightened of not having enough money.”

Without professional assistance, Egger picks up the slack; she drives a half hour each way once a week from where she lives in Seattle to spend time with her father so her mother can leave their apartment for a bit. She’s taken over doing their bills and goes with them to doctor appointments. She feels the strain. “Emotionally, it’s extremely difficult,” she said. Egger now suffers from her own depression. “I worry about them a great deal.”

A policy about to become law in Washington State, the first of its kind, would offer relief to people in Egger’s parents’ position—and to her as well. The Long Term Care Trust Act, which passed the state legislature at the end of April and will be signed into law by Governor Jay Inslee on Monday, establishes the country’s first social-insurance program to pay for long-term care. All residents will pay 58 cents on every $100 of income into the state’s trust. After state residents have paid into the fund for three years, they’ll be able to tap $100 a day up to a lifetime cap of $36,500 when they need help with daily activities such as eating, bathing, or dressing.

The money can be spent in a variety of ways. It could cover a home health aide to provide periodic support and care. But it could also be used to install an accessible shower in someone’s home or a ramp so they can get in and out of their front door more easily. It could cover transportation costs to and from medical appointments or to have food delivered to someone who is homebound.

If her parents had access to a fund like that, “they wouldn’t have to worry” about paying for extra help, Egger said. And Egger herself could relax just a bit. “I would know that [my mother] has someone else to help her instead of just me.”

A recently retired gerontologist, Egger has seen the need for such a policy among the clients she used to work with. One client’s husband had ALS and eventually needed a tracheostomy, which meant his trachea and airway needed to be regularly suctioned. The burden fell on his wife to be at his side constantly in case he needed care. “They didn’t have the resources to hire a nurse…so she could get a break for four hours a week,” Egger recalled. Another of her clients who used a wheelchair after a stroke couldn’t afford to add a ramp to get in and out of his house. The new fund could have enabled him to pay to build a ramp and grant him access to the outside world.

But the long-term-care fund won’t bring relief only to the elderly. A younger person who suffers an unexpected injury or illness could similarly hire someone to help him in his home. Those with disabilities, and the family members who support them, can help cover some of their more episodic needs, particularly for individuals whose needs aren’t severe enough to require living in a facility. “It expands options for people who are in need of care, aging adults, or people with disabilities,” said Sarita Gupta, co-director of Caring Across Generations, which advocated for the legislation.

The payroll premium will collect about $1 billion each year for the dedicated trust fund. “This structure will only help support the work that we’ve done here in Washington to help professionalize caregivers,” noted Sterling Harders, president of SEIU 775, which represents home health workers. While her members had already secured a $15 minimum wage, affordable health insurance, and a retirement benefit in Washington, across the country their peers mostly earn less than that and have little access to benefits. The Long Term Care Trust Act will “help ensure that the caregivers who are providing this care are skilled, that they are trained, that they are certified, that they are paid fairly for the work that they’re doing,” said Harders.

Building a constituency to demand long-term-care insurance requires educating Americans about how neglected this need currently is. Some Americans may erroneously believe that, when they reach old age, Medicare will cover the cost of any long-term care they may need. In fact, Medicare only covers medical needs, not living supports like home health aides or nursing homes. Elders with low enough incomes—depending on the state, anywhere from $6,825 to $47,139 a year—qualify for Medicaid, which does cover nursing-home costs. Those with greater resources must first spend down their savings and assets in order to qualify. They also must demonstrate they have a need for nursing-home care. And some state Medicaid programs don’t cover in-home care, while some of those that do cap the number of people who can get it.

“The system right now is quite narrow, and it requires individuals to basically impoverish themselves to be able to access any coverage,” said Elaine Ryan, vice president of state advocacy and strategy integration at the AARP. There is private long-term-care insurance, but few people have it, in part because the cost of the premiums have become very expensive over the past decade. Its coverage is often also very limited—dementia or Alzheimer’s, for example, typically aren’t covered. So, Ryan explained, “tens of millions of Americans live their lives outside of all of those systems.”

Instead, most people rely on family members or, in some cases, friends to provide them with that care. Among adults with an aging parent who needs care, 31 percent provide it themselves, while 39 percent say another family member does. That places a tremendous burden on the caregivers. Even if someone can take paid time off from work to care for a family member—Washington State guarantees residents 12 weeks of paid family leave—some medical needs may be better handled by a professional. Not to mention it’s hard to do it alone. In one 2015 report, nearly 40 percent of caregivers said it was emotionally stressful, while about 20 percent said they experienced physical or financial strains.

“To date, elected officials have really failed to come up with a plan,” Gupta said. “In the absence of that we see families really struggling to meet their caregiving needs.”

Washington State’s policy, which Ryan calls a “breakthrough piece of legislation,” took years of dedicated, unglamorous work. “We worked with a really broad coalition,” Harders noted, which included organizations like hers representing home health workers, disability-rights advocates, and advocates for the elderly like the AARP. The mix of all those voices united behind a single request helped sway lawmakers. “It made a huge difference that they were standing together,” Gupta noted.

“What really was effective at helping unite us all is that everyone can look down the road and see that we are headed towards a crisis,” Harders explained. As the American population ages, more and more will need help. By allowing people to spend smaller amounts on the kinds of things they might need to safely and comfortably keep living at home, more people should avoid tapping Medicaid to pay for long-term care—which would not just save government funds, but give people what most of them say they want. “It will allow people to take care of those episodic periods where they need that support,” Ryan said. “Most people need something, but not all people need everything…. The idea that everyone’s going to end up in a nursing home can’t be the future that we imagine.”

The amount state residents are eligible for isn’t huge, given that it’s capped at $36,500. If a person needs a few hours of in-home care each week, that means a year or two of coverage. The sum won’t cover a full-time nursing home, which can cost $10,000 a month; a person who needs that will still need to turn to Medicaid for financial help.

But the cap will rise automatically every year as inflation rises. The architects of the legislation were trying to find “a number adequate enough to meet people’s needs and at the same time not be catastrophic if everybody [made claims] at the same time,” Ryan explained. “To make it actuarially sound so people could be guaranteed a benefit.”

The policy’s universal structure and funding is also significant. All working people will pay into the fund through a payroll tax and then be able to claim a benefit when they need it. The same structure has “stood the test of time” with Social Security and Medicare, Ryan noted. Politically speaking, “it mattered a lot that it was set up as a social-insurance program,” Caring Across Generations’ Gupta said. And it ensures everyone will have some cushion when they need it—important given how few people are saving or planning for long-term care. “We have to shift [from] perceiving care as an individual burden to a shared responsibility we all have a stake in,” Gupta said. “This legislation in Washington is a big step toward that end.”

That differs from a failed ballot measure in Maine, which would have guaranteed universal home health care for all disabled and elderly people in the state by levying a new 3.8-percent tax on the wealthy. It’s also different than the Kupuna Care program in Hawaii, which was launched in 2017. That program similarly gives people a daily fund to cover these kinds of needs, but the money comes from the state’s general budget. That means every few years legislators have to decide how much funding to devote to it and that its capacity is limited.

Washington’s social-insurance model could spread if it’s successful after it’s enacted. Similar legislation is being considered in California, Illinois, and Michigan, Ryan said, and advocates in Maine are now looking at legislative options.

“It’s a good model that we’re going to explore in other states,” Gupta said, “and build towards a bigger picture of universal family care being a broader social-insurance program.”

Long-term care is also a facet of the Medicare for All bill put forward in Congress by Representative Pramila Jayapal in February—something the current system doesn’t cover, nor is included in Senator Bernie Sanders’s version. Jayapal’s bill would provide coverage for long-term nursing-home and care services.

Without new programs like Washington’s, families will keep shouldering huge financial and emotional burdens as they care for their loved ones, while many people will struggle to afford the kind of care they want and need. “We don’t think that in a wealthy nation like we live in that’s the way it has to be,” Gupta said. “Having more creative and bold solutions like this [is] going to be really critical.”

Get the inside info on how the #CaringMajority is changing the future of care, every month.